Applied Materials Announces Record Results for Third Fiscal Quarter 1999; New Orders of $1.46 Billion, Net Sales of $1.43 Billion
SANTA CLARA, Calif.--(BUSINESS WIRE)--Aug. 17, 1999--Applied Materials, Inc., the world's largest supplier of wafer fabrication systems and services to the global semiconductor industry, reported results for its third fiscal quarter ended August 1, 1999. Record net sales of 1.43 billion were 28 percent higher than 1.12 billion for the second fiscal quarter of 1999, and 62 percent higher than 884 million for the third fiscal quarter of 1998. Record ongoing net income for the third fiscal quarter of 1999 was 244.4 million, or 0.61 per diluted share, an increase from 141.6 million, or 0.36 per diluted share, for the second fiscal quarter of 1999, and from 70.6 million, or 0.19 per diluted share, for the third fiscal quarter of 1998. Strong asset management performance resulted in a record 2.26 billion of cash and short-term investments at the end of the third fiscal quarter.
New orders for the third fiscal quarter of 1999 reached a record 1.46 billion, an increase of 5 percent from 1.39 billion for the second fiscal quarter of 1999 and an increase of 140 percent from 608 million for the third fiscal quarter of 1998. Regional distribution of new orders for the third fiscal quarter of 1999 was: North America 28 percent, Taiwan 26 percent, Japan 16 percent, Europe 16 percent, Korea 8 percent and Southeast Asia and China 6 percent. Backlog at the end of the third fiscal quarter of 1999 was 1.34 billion.
Gross margin for the third fiscal quarter of 1999 increased to 48.7 percent, from 46.3 percent for the second fiscal quarter of 1999, and from 44.6 percent for the third fiscal quarter of 1998. Ongoing net income as a percentage of net sales was a record 17.1 percent for the third fiscal quarter of 1999, compared to 12.7 percent for the second fiscal quarter of 1999 and 8 percent for the third fiscal quarter of 1998.
"We are extremely pleased with our record performance this quarter," said James C. Morgan, chairman and chief executive officer. "Our customers are experiencing the early stages of a broad-based recovery, fueled by low inventories and strong demand across all product categories, with particular strength in communications and consumer electronic products. Our new orders this quarter were driven by both capacity and technology requirements for 0.18 micron production and pilot line applications, as well as by research and development for next-generation products with design features below 0.18 micron."
"Gross margin reached the highest level in this decade, reflecting the achievement of many operational objectives set within the last year emphasizing cost control and productivity improvement," continued Morgan.
The Company continues to increase its market share in all product segments, with applications incorporating new materials such as copper and low-k dielectric films contributing to these gains. During the quarter, the Company received its first orders for the Electra(TM) Cu ECP (ElectroChemical Plating) system for copper fill, which complements the Company's industry-leading Endura(R) Electra Cu Barrier & Seed system to provide Total Solutions(TM) for high-volume copper manufacturing. The Company also received multiple repeat orders for its high-throughput Producer(TM) platform.
Product introductions this quarter included the Mirra(R) Mesa(TM) CMP (chemical mechanical polishing) system, an integrated polisher and cleaner that provides the industry's highest wafer throughput per square foot the Quantum(TM) ion implanter, a 200mm/300mm compatible system that extends high current implant technology to 0.13 micron device geometries and BLOk(TM), an innovative barrier dielectric film that is combined with other low-k films to increase the overall insulating capability between copper circuit lines. In addition, the Company launched a unique line of service products called Total Service Solutions(TM), which provides customers a performance guarantee to lower overall operating costs and improve system productivity of Applied Materials' equipment.
"We believe the market for semiconductor equipment may double over the next five years, driven by three waves of industry activity," said Morgan. "The first wave, the acceleration of Moore's Law to smaller linewidths, is driving orders today. The second wave, the introduction of several new materials, including copper and low-k dielectric films, is creating the need for a broad range of innovative process technologies. Just on the horizon is the third wave, the industry's move to 300mm wafers, which will require completely new wafer processing equipment. Our broad product offerings, product development capability and global infrastructure continue to position the Company to address the opportunities ahead," concluded Morgan. |
